[monero-xmr]

If I use a drone to look over a fence to count the amount of inputs and outputs of a factory, and only I know this, it is perfectly legal for me to trade on it. Not insider trading! I'm just a really good information-finder and I'm morally just in how clever I am at finding an edge.

If I work at the company and count the inputs and outputs, and trade on it, I am a morally bankrupt scumbag and I have hurt society and all of the traders in the market.

Hmmmmmmm

[MarkusQ]

If you work at the company you have almost certainly signed an agreement not to disclose such information; if you do so, you are violating the agreement. But that isn't insider trading.

If you hold a position of fiduciary responsibility within the company (or gain information from someone who does) that's a different matter. But the analogy there would be hacking into the company to read internal records, not just looking over a fence. in both cases, it's a crime.

[nilamo]

Yes that is correct. Or if you're a player on a team, you could just... tank a game.

[KPGv2]

This is a troll post, and I'll bite.

The reason insider trading is illegal is because it undermines confidence in the markets by establishing a pattern by which insiders with privileged, secret information leverage it to profit off people who cannot access this information.

It also incentivizes insiders to leverage their position within a company to manipulate the business in order to profit. This also undermines integrity of markets.

Your second example, setting aside all your troll bait inflammatory verbiage about moral bankruptcy, is an illustration of this risk. I don't care if it rises to the level of moral bankruptcy, it is harmful to a capitalist society in a serious way.

Your first example is a depiction of someone leveraging information that anyone can gather. It does not undermine the integrity of markets because it is just an investor acting on publicly-accessible information.

[rwmj]

Correct, but they can access the information as soon as it is revealed.

Consider the case where a company knows that the drug they are selling is dangerous but keeps it a secret. Insiders know of the dangers and so bet against the company in the market (obviously this is illegal right now). The insiders make a profit in the short term, and investors also in the short term lose out (which they were going to do anyway, the losses come sooner), but in the long term the secret information is revealed to the benefit of everybody.

[KPGv2]

I don't see how this is responsive to what I wrote. Are you arguing that insider trading is no big deal? If so, what you're actually saying is "insider trading is no big deal because eventually bad information does reach the public."

But I never said insider trading was bad because it caused people to keep information a secret. You're responding to an argument I didn't make.

[monero-xmr]

I don’t see the harm of insider trading. I would make the trades public and mark someone as an insider. The “cat and mouse” game played now leaves for endless suspicion

[hananova]

Or a reasonable door number three: Trading on it should not be allowed, without exception.